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Culture sec consults Ofcom, OFT on BSkyB merger

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Updated Culture secretary Jeremy Hunt is writing to Ofcom and the Office of Fair Trading today to seek advice from the regulators over the proposed merger of television broadcaster BSkyB with Rupert Murdoch's News Corp empire.

The move, reported by the BBC, follows the sudden shuttering of Sunday tabloid the News of the World.

Murdoch's News International, which is headed up by Rebekah Brooks, decided to kill the newspaper late last week, when she told journalists working on the tabloid that the title had become "toxic".

The decision came in the wake of new and shocking phone-hacking allegations against the paper, alongside claims that illegal payments to police in exchange for information had taken place. As more damaging reports surfaced, advertisers started abandoning the tabloid and MPs called on the government to halt the proposed buyout of BSkyB by News Corp – the parent company of NI.

The Register met with Ofcom boss Ed Richards last Wednesday, when he told us that the communications watchdog couldn't intervene on the planned merger of BSkyB with News Corp until a police investigation into the phone-tapping allegations at the News of the World has concluded.

He said at that point that any recommendation to block Murdoch's bid to buy BSkyB could not be put forward until facts in the case are established.

"We will consider our position only once the police investigation is complete ... then we'll look at it, if we need to," said Richards. "We, like many others, will wait to see what emerges."

By Friday, Ofcom had reiterated that statement, and added that it was "closely" watching events unfold at News International.

Richards also told us that a so-called "fit-and-proper" test of BSkyB is ongoing, as is the case with all broadcast licence holders. Ofcom had previously presented Hunt with advice on plurality.

It's expected that the culture secretary will once again seek advice from Ofcom on the matter of plurality, following Murdoch's acknowledgement that "deplorable and unacceptable" events had taken place at the NotW. The billionaire media tyrant said late last week that his company was taking "a number of important steps to prevent them from happening again."

Meanwhile, shares in BSkyB have tumbled 7 per cent and are currently trading at 699p on the London Stock Exchange, following news that Hunt was writing to Ofcom and the Office of Fair Trading.

The minister could yet consider referring News Corp's proposed buyout of the remaining 61 per cent of BSkyB it doesn't yet own to the Competition Commission.

Labour leader Ed Miliband is separately calling for a House of Commons vote in an effort to delay or prevent the merger, while police investigations into the conduct of individuals who were on the NotW payroll continue.

Last Friday, 43-year-old Andy Coulson, the former official spokesman for Prime Minister David Cameron as well as being the erstwhile editor of the News of the World, was arrested and later bailed on charges of suspicion of conspiring to intercept communications.

The Metropolitan police confirmed two other arrests over the weekend in relation to Operation Weeting and Operation Elveden – the investigation into allegations of bribery of police officers.

It is understood that one-time NotW royal editor Clive Goodman, who previously pleaded guilty to conspiracy to intercept voicemail messages in November 2006, was among the individuals arrested and then bailed as part of the ongoing police probe. ®

Updated to Add

The Culture Secretary's letters to the regulators can be read here.

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